short saleMany Realtors and Investors really don’t know the secrets to a successful short sale. They think just because they make an offer close to market value that their short sale should go thru! Obviously, that is not correct. The secret to a successful short sale consists of several things including 1) listing price and 2) broker price opinion/appraisal on the property.

Let’s start with the listing price. How do real estate agents get paid? By commission right? Are they not taught that they need to list the house as high as possible to get the best price for the seller and the highest commission for themselves? So … when a Realtor is not trained how to do a short sale, what price do you think they list the house at? They list it for as high as possible. Unknowingly, they are doing a disservice to the sellers, buyers and themselves; as it is the Short Sale Lender that tells the agents, sellers and buyers how much they are willing to sell the property for. So, when the Realtor lists the property high, it encourages the BPO agent, who is also a Realtor, to try and reach for the list price. Remember, they use to be Realtors receiving commission and they too would list the property as high as possible. The only designation that I hold as a Real Estate Broker is SFR which stands for Short Sale Foreclosure Resource. I took this class just to see what the Realtors are being taught on short sales. I was impressed that they also recommend that the property be listed LOW not high so that the BPO Agent will provide the Short Sale Lender with their own value instead of reaching for list price. Just like an appraiser, they are also encouraged to reach for the list price since 99% of the time appraisals do not come in higher than either list price and/or the purchase price which a buyer is willing to pay.

Short Sale – What is a BPO or an Appraisal?

What is a BPO or an Appraisal? Both are just opinions of what the property is worth. Even Short Sale Lenders don’t agree with the value that an unrelated third party person such as a BPO Agent or Appraiser provides to them. When they don’t agree with this amount, they send their file up to a department called a Reconciliation Department who in turn will literally look at Zillow (which you and I know is incorrect) and other websites to determine the value the property should be versus using what was provided to the Short Sale Lender by the BPO Agent or the Appraiser. The Short Sale Lenders also use an automated system to re-evaluate the property so … when working on obtaining the value from the Short Sale Lenders, your negotiator must always ask “Is this a reconciliation value?” Knowing the answer to the question will allow you to dispute value.

A value on the property obtained from the lender normally lasts 90 days. During this time, your negotiator has the right to dispute the value providing comparables, repair bids, crime reports in the area, sex offender reports and anything else that would help dispute the value which they have. If you win the argument that their value is incorrect, then they will order another value on the property. Should this property be an FHA property, then the lender’s value lasts for 4 to 6 months and this value is harder to argue unless your buyer obtains an appraisal for a lower price.

I do want to say if a buyer provides the Short Sale Lender with an appraisal done on the behalf of the buyer for funding purposes, 99% of the time, the Short Sale Lender will accept that appraisal as value and will reduce their amount. However, I have also seen when I have provided an appraisal to the Short Sale Lender to use as argument, they will turn around and sell the loan and we had to start all over again on the short sale with a new Lender.

Now let’s talk about the major mistakes that happen when NO ONE meets the BPO Agent and/or Appraiser for the Short Sale Lender. If the Short Sale Lender has changed the locks, that means that BPO Agents and/or Appraisers have their own key or code to get in without anyone being present. In addition, if the listing agent put a electronic lockbox on the property, then the BPO Agent and/or Appraiser can get in without telling you. I teach you in my home study course that there are 13 crucial steps to a successful BPO/Appraisal. Below are the 5 of the steps to a successful BPO/Appraisal:

  1. When the BPO Agent contacts you by telephone to schedule appointment to do the BPO, you need to start building rapport immediately. Read the Script of Initial BPO or Appraisal. Ask her “if she is aware that the property is in foreclosure?”
  2. Ask her “when is the best time to meet at the property?”
  3. Tell her “We are working with the Seller and the Bank to liquidate the property and the Bank is looking for a “Quick Sale or AS IS” value.
  4. Schedule a time convenient for you and her since you NEED to be at that appointment; this is not an option for you.
  5. There is a list of documents that we provide in our BPO Package when we meet with the BPO Agent and/or Appraiser.
    1. A File Folder that is marked with “FORECLOSURE”
    2. The File Folder should that is marked with “We are working with the Seller and

The bank to liquidate the property.”

  1. The Purchase Agreement which you submitted to Loss Mitigation.
  2. Provide a copy of the Hardship letter.
  3. Newspaper Articles of the market decline
  4. Low Comparables only that have sold in the last 3 months and 3 low Active Comps
  5. Contractor Bid or Repair Cost, if any
  6. List of sex offenders
  7. Crime Report of the area


However, I do want to caution you that not all BPO Agents or Appraisers will take your folder as they believe it is against their guidelines. I was told by a BPO Agent that she is suppose to spend at least 20 minutes in the home and I am hear to tell you that they spend less than 10 minutes…more like 5 minutes! BPO Agents are paid $50-$75 for a BPO plus a bonus if they return it within 24 hours. Appraisers will receive $125-$300 for their report with no bonus for fast turn around.

Based on this article, I hope you all understand that you MUST meet the BPO Agent/Appraiser at the property for their value. Failure to do so will leave you 85% of the time with a higher value due to the fact that the repairs needed for the property were not taken into consideration. Also, repairs such as carpet and paint are considered cosmetic. In addition, outdated fixtures, bathrooms and kitchens are not considered as long as they are functional.

One last thing, even the best negotiator can’t argue value on a home unless they have aminution such as low comparables, repair bids, appraisals, and other things I have mentioned in this article. So meet your BPO Agent and/or Appraiser at the property and provide them with the information they need and if they fail to take it, be sure you physically point out all the damage in the home, as the agent walks through, so that they take pictures to provide it back to the Short Sale Lender of the true value of the home!


Happy Negotiating!

Kimberlee Frank

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Kimberlee Frank Broker Short Sale Expert


Kimberlee Frank Real Estate Broker and Teacher/MentorKimberlee Frank is known as “The Real Estate Junkie,” for her unique ability to find ways to creatively help buyers and sellers no matter which direction the real estate market is heading. Kimberlee had already worked as a legal administrator for an Attorney, Builder and Broker for 18 years when she began her Real Estate career in 1998. She dotted the i’s and crossed the t’s on hundreds of real estate transactions and thousands of documents, making her an expert in real estate documentation. Kimberlee’s success began in Fenton, Michigan. She specialized in selling, purchasing, renovating, retailing and lease optioning single-family homes. She has helped many sellers get rid of their “headaches” and helped many buyers find their dream homes!


Since 2003, she has specialized in foreclosures and short sales. After realizing how many families were being forced out of their homes due to financial difficulties, Kimberlee had a heartfelt obligation to use her experience to help those families. She has mitigated and closed over 500 short sales with the mortgage companies, saving Sellers from going into foreclosure. In 2006, Kimberlee and her family moved to Florida. She lives in Oviedo and her Sell Fast Realty Office is in Winter Springs, serving residential and commercial sellers and buyers in multiple counties in Central and Southern Florida.

Kimberlee is also a Trainer and Mentor and has created several different “How To” systems on real estate. Her unique strategies continue to educate real estate professionals across the country. If you have a proven system to help others out of hardship, why wouldn’t you duplicate it and share it with as many people as you can? Kimberlee continues to work with this philosophy!

Kimberlee Frank Author of Big Ideas for Your Business
Kimberlee Frank has been featured on ABC, NBC, FOX, CBS as well as Wall Street Journal, Newsweek, USA Today and numerous other publications. She is the bestselling author of “Big Ideas for Your Business” (Advantage Media 2009). She was also selected as the #1 Short Sale Expert by America’s Premiers Experts.

Please contact Kimberlee at her office at 407-888-3433 to schedule a Free Facts About Foreclosure Seminar. She has numerous testimonials from sellers, buyers and other real estate professionals who are familiar with her giving heart. Whether it is 1 person in need or 1,000…..Kimberlee will educate them on real estate and give them a solution with a peace of mind!

Kimberlee Frank saught out by the media


Are you unsure what to do with your house? Do you need to educate yourself about your options. Click the following link Free Facts About Foreclosure for more information.


God Bless,

Kimberlee Frank


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